I have been C&E on the agencies for more than 7 years. Reasonably constant work except for some quiet spells at the beginning of the year
I was told by Lloyds bank they couldn’t offer me any mortgage stating that my company books were showing too low profit. This low profit on company books is normal for a lot of one-man bands around the country.
Same thing went with some IFA’s (Independent Financial Advisors) - Nobody would touch me, they didn’t even want to see bank statements.
I met a driver the other day who told me to get a full time job, get the contract to show the Mortgage lenders then quit.
Is this done a lot…has anyone acquired a mortgage this way?
I am in the Lutterworth area BTW.
It’s decades since I took out a mortgage but when I did the building society wanted a reference from my employer, I honestly cannot see a contract of employment that shows you’ve recently joined a company swinging it for you, as an employee at the very least I would have thought they would want to see a reasonably substantial work record.
The rules are much tougher now from memory they want 20k clear profit after tax an all outgoings for se and ltd. So basically any se driver is stuffed I’ve even been told couples both with 40k a year each and paye were turned down because they had 2 kids. I was told this by a site sales manager as I’m doing home delivery mainly
I don’t think there are many lenders offering 6x income from PAYE let alone self-employed etc.
I would have thought you’d get more interest with a 3.5x multiple though. I got mine on that multiple, with my payslips handily being full of “scheduled attendence” that didn’t ring any bells as to it being “Overtime”. Indeed, I was asked by the lender “what SA is” - I merely replied "I get it every week as part of my wage", and that was good enough for them to count it as part of my “basic pay” for the multiplier calculation.
I believe that lenders these days will still count “any pay you get, even when off sick or on holiday” as your “basic pay”.
aposhark:
I met a driver the other day who told me to get a full time job, get the contract to show the Mortgage lenders then quit.
Is this done a lot…has anyone acquired a mortgage this way?
Full of crap. They want at least 12 months employment.
Welcome to the downside that nobody talks about of claiming everything as an expense and earning next to nowt on paper. When you pay next to no tax it is because on paper you’ve not earned a lot. Not usually a problem until you want to borrow money.
Mortgage companies won’t accept “I know I claimed 45p per mile but it didn’t cost me anything near that to run my car”.
When the latest unsustainable house price bubble bursts, you might be pleased about not getting that mortgage.
Sooner or later the national debt of £1.5 Trillion is going to become a mill stone when interest rates rise, that funnels down the line to us the muggins who are going to pay it off for them, many of us have paid (variable, thats about all there was) mortgages of 15% in years gone by, that could happen again, and it won’t be much fun when the house you paid £200k for is worth £120k.
If you know anyone really switched on wealthy who has a large property portfolio (i don’t mean a couple they own as an alternative pension scheme) be worried when they start to unload.
Sometimes your accountant can do such a great job doing the accounts that you show no profit, and therefore pay no tax. But the flip side of that is when you come to buying a house. This happened to a mate S/E in another industry, who had to get the accountant to play it straight, and show how much profit he was making. Which in turn enabled him to get a mortgage
Juddian:
If you know anyone really switched on wealthy who has a large property portfolio (i don’t mean a couple they own as an alternative pension scheme) be worried when they start to unload.
Juddian:
When the latest unsustainable house price bubble bursts, you might be pleased about not getting that mortgage.
Only really London which is suffering from that. In most of the rest of the regions the increases are no more than 4.5% increase from May 2013- May 2014 with four regions being barely higher than inflation.
it won’t be much fun when the house you paid £200k for is worth £120k.
Doesn’t make any difference unless you want to move.
Doesn’t make any difference unless you want to move.
Does if you get repo’d and that happened to thousands of poor buggers, or split relationship which is often the result of financial hardships…whats that old saying about love flying out the window as poverty comes through the door.
Harry, thanks for the Telegraph link, food for thought.
I had an IFA appointment two Saturdays ago he averaged my wages for the past 3 months (plenty of OT) worked it out to nearly 28K. Got offered 136K as a single fella!!
He also told me you can get a mortgage even if you’ve only been in a “proper” job (I say that loosely not stepping on toes tonight!!) 1 day.
it won’t be much fun when the house you paid £200k for is worth £120k.
Doesn’t make any difference unless you want to move.
Having been in negative equity in the early 1990s, I can assure you that it’s not a good feeling watching new neighbours moving in who have paid two-thirds of what you paid for an identical house, and knowing it will take you eight or ten years just to get yourself into the financial position they are in now… personally I would not dream of buying a house at the moment, Cameron will be lucky if he can keep the Ponzi scheme going until the General Election, as soon as interest rates move upwards then hundreds of thousands of “homeowners” will be toast.
I went employed from being Ltd Co in order to better secure a mortgage and also get the dratted DCPC cracked.
There was no doubt that being a company lacky worked for me, but now with the DCPC nearly done and home suiting me brilliantly, the detatched & smug mandarins managing/lounging in Transport Towers may soon get a ‘Dear John’ in their in-tray
We’ll see if I can be bothered - since daily chasing up start-times & submitting weekly returns was hardly a holiday either
It’s the time-worn question to ask myself - ‘which grass is now the greenest’
Juddian:
If you know anyone really switched on wealthy who has a large property portfolio (i don’t mean a couple they own as an alternative pension scheme) be worried when they start to unload.
Interesting … I wonder how a friend of mine will react, as the last time I spoke to her she owned 600+ house, which she rents out to anyone. iirc 5yrs ago her company was valued at over £50m, not bad for a girl from Grimethorpe
I’m Ltd Co - not had any problems getting mortgages or loans.
It’s easier if you go via your bank (assume business & personal with same one) as they see what goes through your accounts. I just give them copies of Accounts and all is well. Its not profit they should interested in, as good accountant will make sure you make a low profit - they should look at Turnover, Drawings and Dividends.
Herongate:
I’m Ltd Co - not had any problems getting mortgages or loans.
It’s easier if you go via your bank (assume business & personal with same one) as they see what goes through your accounts. I just give them copies of Accounts and all is well. Its not profit they should interested in, as good accountant will make sure you make a low profit - they should look at Turnover, Drawings and Dividends.
I went to LLoyds (business and personal) and they said “sorry we can’t help you”.
I said “not even one pound”.
They said “sorry”.
They (lenders) only look at profit, not what is going into the bank.
I have had to rent now as my daughter needs to start school.
I will leave Lloyds as soon as we are settled again.
